Complex taxation rules on golden handshakes can see the Tax Office taking a large and unexpected bite out of a redundancy package.

The Canberra Times revealed on Monday that some public servants taking redundancies have been short-changed by up to tens of thousands of dollars on their payouts because their departments lack enough qualified payroll specialists.

But a taxation lobby group and a top accounting firm are warning bureaucrats of yet more hidden dangers, urging that they fully understand their tax liability before they accept a redundancy.

One retired bureaucrat, who asked not to be named, has told this newspaper that mistakes by his department's outsourced payroll contractors left him "owing" $70,000 from his payout to the ATO, which he only discovered when submitted his tax return after his redundancy.

After a long and expensive dispute his correct liability was re-calculated at just over $2000.

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Mark Chapman from Taxpayers Australia said the thousands of older public servants leaving the bureaucracy in the present wave of redundancies needed to be particularly careful.

"First issue is one which has come up several times and has caught many people unawares," Mr Chapman said.

"One of the conditions for the payment of part of a redundancy package tax-free is that the recipient must be under 65 at the time of the redundancy.

"So an employee who takes a package at 64 years of age will pay less tax than one who takes an otherwise identical package at age 66.

"This is counter-intuitive as to how most people would expect redundancies to work and also appears discriminatory against older workers."

Mr Chapman, himself a former taxation official, warned that some "Employment Termination Payments" were concessionally taxed at lower rates while others were not.

"There's also a tax-free amount which can be paid in relation to genuine redundancies," he said.

"Lump sum payments for accrued annual leave, annual leave loading or long service leave paid on ceasing employment are taxed under different rules, even though in practice one lump sum, combining all these different elements, is likely to be paid to the departing employee.

"So, the payroll person needs to correctly identify every element of the payment being made, how much that element is in dollar terms and what the tax treatment is."

Mr Chapman said it was not surprising that errors were being made as thousands of redundancies were processed across the service, but he said the government had a responsibility to get it right.

"The government is surely culpable for not foreseeing the issue and providing sufficient resourcing to enable department to have access to appropriately qualified payroll staff," he said.

Rohan Geddes, employment taxation partner at accounting giant PwC, says that calculating redundancy payments can be difficult for employers.

"There's a series of factors, ranging from age to years of service to the amount of other income they receive which does make for complex calculation," Mr Geddes said.

"Individuals should seek accounting advice and we'd hope that employers would also be working with taxation advisers to ensure they get the calculations correct."

He urged workers to seek independent accounting advice before making final acceptances of redundancy offers.

"From a cash-flow planning perspective, it's something that's important so you don't get those nasty surprises," Mr Geddes said.

The PwC partner said that a commonplace mistake was employers withholding the wrong amount of tax from a golden handshake payment.

"That doesn't change the tax liability, it just means that the employee, when they file their tax return, is going to get a nasty surprise," he said.

"The other one is that if the employer has not coded the payment correctly, that could generate an incorrect tax liability."